Bullish: To Give Up or Not to Give Up? A Column About Bankruptcy

It took longer, and was much more painful than I had hoped, to come back from that (sorry to say). But I gained some things there’s no other way to get. Age 24 is a great time to have a hugely stressful, remarkably adult problem. My problem – in part, that my office landlord sued me for back rent and locked me out of my office, thus preventing me from doing any more work and trying to pay the bills – just overloaded my stress system until it broke, like when you play music loud enough to blow out a speaker.

Now, I can do almost anything with much less stress. Hopping on a plane, alone, to India or Argentina; getting lost where you don’t speak the language; having to wrest back a deposit from a slum landlord; negotiating for a raise after realizing that you’ve been a fool and that others have already negotiated superior deals for themselves? I feel remarkably relaxed. If I had balls, I would sit in a way that gave them a lot of space.

Before I failed hard at something, I was the sort of person who felt stress about late library books.

That said, let’s talk about two things: the actual decision making, and what it’s like to live life after bankruptcy.

Why Bankruptcy Exists, and Whether You Should Jump On It

As you mentioned, Emily, you are very responsible with actual money that you’ve earned. Emily mentioned that she has zero credit-card debt and no student loans.

What happened to Emily – having auto insurance and still being on the hook for insane amounts of money (if personal injury lawsuits ensue) – is something I’m pretty sure that civilized European countries don’t allow to happen to people. Those are countries that also make sure that everyone with cancer receives treatment.

I have a general guideline: if Europe wouldn’t have let it happen to you, it’s not entirely your fault. In this country, we let medical bills bankrupt people. I’m pretty sure that in any civilized fucking European country, we don’t put a 24 year old on the hook for an amount of money almost no 24 year old can come up with. (See my thoughts on Occupy Wall Street.)

I am reminded of a column I read by The Ethicist,Randy Cohen, for the New York Times. A reader wrote that s/he works for an antipoverty nonprofit that pays volunteers a poverty-level stipend and encourages them to apply for food stamps. The writer wonders, as a college graduate who could have made other choices and made a decent living, whether it would be ethical to apply for food stamps. Cohen replied:

It is indeed ethical to apply for food stamps. And when you do, fill out those forms honestly and comply with all eligibility requirements, which refer not to some hypothetical earning power but to your actual income. Those who designed the program could have required you to seek more profitable employment (recipients of unemployment benefits must demonstrate that they are able and available to work, for example), but they chose not to. No nurse’s aide or poet (or poetical nurse’s aide) is compelled to return to school for an M.B.A. And you have no obligation to set more rigorous food-stamp eligibility standards for yourself than your state has.

I think this applies to you. Bankruptcy would not exist – with its reams of regulations and requirements already – if it were not meant to be open to people exactly like you. You meet the eligibility requirements, and you have no obligation to “set more rigorous eligibility standards” than the law. (Also, I really like when the Internet works; I had a vague memory of having read this article in a paper version of the Times in 2005, and found it instantaneously by Googling “ethicist food stamps.”)

There is a reason we no longer have debtors’ prisons. Society has an interest in your becoming a functioning, taxpaying member of society. We don’t need to push you off the grid.

I think that’s great advice! When I was 19, I graduated from NYU, owing directly to the school (not to student loan companies) $30K. (Long story.) Because of medical issues at the time- not to mention that I was just 19! with no work experience!- I just didn’t have the funds to make even meager payments towards the debt. NYU threatened me with legal action from the get-go. I ended up running- living off the grid, destroying my credit, until 8 years later I reemerged. I wish I just declared bankruptcy- it would saved me years of hiding and shame, always running from NYU’s collection agencies, not to mention just the sheer inconvenience of being terrified to pick up my phone or leave any trace of my address anywhere. Thankfully when it all came to an end, I was still young, and still capable of erecting a credit score that makes me proud. (800 thank you very much.) If you need to do something like this, you couldn’t have picked a better time. There is light at the end. Grab it.